The importance of dollar-cost averaging in Crypto investing.
I’ll start by this — Coinbag is not an investment advisor, rather sharing personal experiences for you to learn from on your investment journey.
I’ve been investing in crypto since 2015, and in this market, seemingly more than traditional markets, I find that people think they can outsmart the market. Because of the volatility, people develop this notion that they easily predict when the market will be at the bottom and when the market will be at the top. Unfortunately, this couldn’t be further from the truth, and I have seen so many people lose so much because of this.
How does this work in highly volatile markets?
For highly volatile markets, it is even more important to deploy a dollar-cost-averaging strategy.
We never try to time the market. At some point, most investors start think that they see patterns and can outsmart the market. This may work a few times, but adds unnecessary stress and emotion to your investment decisions.
Dollar-cost-averaging is the practice of putting in set amount of money over a specified period of time. Sometimes you will buy when the market is high, sometimes when the market is low, but the key point is that you will have a solid cost-basis to your investment with very little the stress.
How do I do this?
One method we have seen is to sync to your paycheck. When your paycheck arrives, allocate a percentage to your crypto investments. This means that you take the money and directly deposit into Binance. Coinbag will take care of the rest.
I don’t have a paycheck, how can I do this?
Let’s say you have a certain amount of money you want to invest in Crypto. An example: $100. We suggest you divide $100 by 26. That will then give you the amount of money you need to invest every 2 weeks over a 1 year period. If you want to add to the total amount, just divide the total by the remaining number of weeks.
Are you interested in investing in Crypto? Get started with us today!
Disclaimer: Coinbag Limited is not a broker-dealer, transactional intermediary, counterparty or investment advisor. Coinbag Limited is not registered with the Securities and Exchange Commission (SEC) as an Investment Advisor. Coinbag Limited offers information for educational and entertainment purposes only. Any investment decision a user of the Coinbag platform may make is solely at his or her own discretion and risk.
